# Organizations can get incomes via Contracts, budgets, or products Contracts have more or less fuzzy deliverables. You need to do some sort of sales to get a contract. Contracts have more or less fuzzy deliverables. Grants are a form of contract funding with fuzzy deliverables. Products are something where you build the thing and then people pay you for them. In a way, prizes are a form of ‘product funding.’ The line between contract and product is not always well-delineated. Budgets you just get money from someone else that you’re in a relationship with. Everything is implicit. Budgets for organizations are analogous to salaries for people. Budgets are fragile - if you have a budget you have a steady source of income … until you don’t. Organizations with budgets can be defunded at any time. They generally don’t have any buffer. At the end of the day the knobs that get turned are * Direction setting * In a contract system the funder sets the direction * In a product system the fundee sets the direction * In a budget system the fundee sets the direction * Tightness around deliverables * In a contract system the agreement is tight * In a product system the agreement is loose * In a budget system the agreement is tight * Explicitness of the agreement * In a contract system the agreement is explicit * In a product system the agreement is explicit * In a budget system the agreement is implicit All the possibilities * Funder direction + tight deliverables + explicit agreement *Contract* * Funder direction + loose deliverables + explicit agreement *Bad contract?* * Funder direction + tight deliverables + implicit agreement *Prize?* * Funder direction + loose deliverables + implicit agreement *Grant call* * Fundee direction + tight deliverables + explicit agreement ?? * Fundee direction + loose deliverables + explicit agreement *Product* * Fundee direction + tight deliverables + implicit agreement ?? * Fundee direction + loose deliverables + implicit agreement *Career Grant* ### Related * [[It is relatively easy for DARPA PMs to re-deploy funding]] * [[Organizations and their funding mechanisms are coupled]] * [[People create proxy games for long term or hard-to-measure games]] * [[Lee Ricketson conversation 6/5/20]] * [[Innovation orgs need to be aligned with their money factory]] <!-- #stub --> [Web URL for this note](http://notes.benjaminreinhardt.com/Organizations+can+get+incomes+via+Contracts,+budgets,+or+products) [Comment on this note](http://via.hypothes.is/http://notes.benjaminreinhardt.com/Organizations+can+get+incomes+via+Contracts,+budgets,+or+products)